An idea can be developed into a mobile startup through your personal business/organizational skills, a reliable team, careful planning, proper funding, and passion to struggle for what you do. Each of these constituents is required. But the most problematic one is arguably funding your software project.
The first rule is: be prepared. Whatever will be the source of funding, you must always be well-prepared, you must have a business plan, financial forecasts and start-up costs. You may hire an expert to help you with making this documentation as consistent and comprehensive as possible. What is the need for your future software product? Who are your competitors? Who are the audience you are targeting? Once you have all the needed information in your hands, along with marketing analysis, risks and pricing models, you may look for investors/partners.
You may try and go for a loan in a bank. But if you would prefer another way, what would be the options?
Family & Friends
If there is a friend of yours or a member of your family who has the necessary funds and is interested in an investment. Although it means an initial level of trust, there has to be a contract, and the investor is still an investor who needs to know everything about your project. You need to define terms and expectations. This could be partnership for a share of the startup or a loan with returns as interests. The thing here is keeping in mind all the possible pitfalls (the most obvious one is that startups tend to fail) and not ruining relationships, not mixing business and personal. This mustn’t be the money that your investors can’t afford to lose. Especially worth noting the fact that software projects presuppose software owners having additional funds during the development already, let alone after the launch of a product.
Here’s a rather hard way which however is chosen by many tech startups. Crowdfunding (collective funding through personal finances by any willing participants) can be done through specialized websites, each having their own terms and conditions. Let’s name Kickstarter and Indiegogo as perhaps the most popular ones, but surely it’s not the limit to stick to. As the initiator, you set forth the purpose of your startup, the required amount of money, and the information is open along the way. This means you expose your ideas and intellectual property, so in some cases it might be not the best way for you.
Business angels are individuals who invest their own finances into startups, and many of them unite in groups and communities, such as AngelList or Angels Den. Angel investors are usually experienced business people who can see a startup which is capable of becoming highly profitable. Returns can also be expected in various forms. The good side for you is that an angel investor has not only financial strength, but as well might provide the needed connections and give advice, which is even more valuable in case your investor had experience in the IT sphere. These people realize the risks of failure and are willing to help a startup to break through.
Let’s outline this as a separate way of raising funds – finding a person to become a business partner, a co-founder of a startup. This person has the funds for implementation of your project, and if he/she becomes a business partner, it will be a certain kind of a marriage, there must be trust and understanding between you, common goals and vision, otherwise the first pitfall might be the last for the project. A business angel can eventually become your business partner, or this may be your friend.
Conferences & Events
An efficient means of finding new business contacts is participation in business conferences and startup contests (such as Startup Weekend, IDCEE, Startup Safary, Global Startup Battle,StartUP Berlin, etc.). It’s possible to start developing a partnership and find the required funding there by presenting the ideas of your startup.
Whatever ways will be yours, one of these or another, always differentiate business and personal, be forward-thinking and clear with your expectations. You’ll have to get acquainted with the problems concerning the IT sphere (unless you are an IT specialist, which is quite possible for a future startup owner), such as the issue of software requirements that’s currently one of the biggest problems in development. Don’t be defensive, set a clear goal, be honest and committed, and go for results!